21st Feb 2019 07:29
LONDON (Alliance News) - Defence firm BAE Systems PLC boosted its annual dividend Thursday after its order book reached record highs and profit rose on lower costs, despite revenue dipping.
Meanwhile, the FTSE 100-listed company also hired the current finance chief of miner and commodities trader Anglo American PLC as a non-executive ahead of a forthcoming retirement of a long-serving board member.
In 2018, pretax profit widened 14% to GBP1.22 billion from GBP1.07 billion the year prior. This was despite reported revenue falling 2.3% to GBP16.82 billion from GBP17.22 billion the year before, on a constant currency basis falling by 1%.
Profit performance was helped by a sharper 3.3% fall in operating costs to GBP15.51 from GBP16.04 billion the year before.
BAE proposed a 13.2 pence per share final dividend, up 1.5% from 13.0p the year prior. For the full year, the dividend rose 1.8% to 22.2p from 21.8p in 2017.
"The group made good progress in strengthening the outlook and geographic base of the business, with a number of significant contract wins," BAE Chief Executive Officer Charles Woodburn said. "The defence order backlog is now at a record high with visibility on many of our key programmes through the next decade."
The order intake during 2018 jumped to GBP28.28 billion from GBP20.28 billion in 2017. This helped take the order backlog to GBP48.4 billion at the end of 2018 from GBP38.7 billion at the end of 2017.
"Delivering a strong operational performance and continued investment will enable us to meet our growth expectations and underpin the long term", Woodburn added.
In a separate announcement, BAE announced it had appointed Anglo American Finance Director Stephen Pearce as a non-executive director from the start of June.
The appointment of Pearce follows current Non-Exec Nick Rose - who has served for nine years at BAE - announcing his intention to retire at the end of 2019. Pearce will replace Rose as chair of the audit committee from the start of 2020.
"I very much look forward to Stephen Pearce joining the BAE Systems board," BAE Chair Roger Carr said. "He is a seasoned executive with considerable international experience. In particular, his finance knowledge and skills will further strengthen the board, and make him the ideal candidate to succeed Nick Rose as chairman of our audit committee from the beginning of next year."
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